Bernanke: A Tenure of Failure: An Addendum
President Obama recently commented that he wanted a next Fed chairman who would do good for all not just for Wall Street and the rich [and politicians and chrony capitalists supporting government spending at unsustainably high levels), but for everyone. Perhaps if what he has in mind is a real “helicopter Ben” who, instead of buying $85 billion in securities a month from financial institutions, would drop $85 billion from helicopters at pre-announced locations, the common folk might feel an illusion of increased prosperity in the very short run. If he is truly serious about a first do no harm monetary framework, he would work with closely Ron Paul not just to audit the Fed, but to dismantle it.
More criticisms of Bernanke’s post 2008 policy from Austrian sympathizers and non-Austrian sources:
From yesterday’s Wall Street Journal Ronald I. McKinnon makes a similar point to Salerno’s argument that a low interest rate environment impedes recovery. In “The Near-Zero Interest Rate Trap”, McKinnon summarizes nicely, “By trying to stimulate aggregate demand and reduce unemployment, central banks have pushed interest rates down too much and inadvertently distorted the financial system [and real structure of production] in a way that constrains both short- and long –term business investment. The misnamed monetary stimuli are actually holding the economy back.”
Steven H. Hanke also has some relevant commentary on how current policy has retarded rather than stimulated recovery. See:
Especially section 3: Rethinking the Fed’s Monetary “Stimulus”